What do you think is preventing you from achieving financial freedom? Well, it’s easy to get swayed by the consumerism culture and end up spending unnecessarily on things that you could otherwise have gone without!
Maybe, you don’t even know where you are shelling out extra bucks you could have saved. That’s why it is important to consider adopting a frugal lifestyle. Well, frugal living doesn’t mean embracing a cheaper or low-grade lifestyle. Rather, the beauty of frugality lies in tweaking your spending habits without being a miser!
You won’t be sacrificing much when you embrace a frugal lifestyle. However, this can save you at least $22 a day. How about putting these aside into a savings account or channeling them for your retirement savings?
With a broader financial picture driving your spending habits, it makes sense to cultivate frugal living habits.
What Does Frugal Living Mean?
The term frugal living is often used synonymously with minimalism or even living cheap. However, this is a lifestyle where you voluntarily make decisions to live within your means by making conscious preferences.
It is a holistic concept where you curtail your expenses by being vigilant about your spending habits. People living a minimalist lifestyle do away with things that don’t matter to them much. Accordingly, they live in a limited space and prioritize aspects they are concerned with. On the other hand, living cheaply involves a low-grade lifestyle or often living with limited financial resources.
With a frugal lifestyle, you get to prioritize your expenses. It’s more about utilizing the entire value of your money by being resourceful.
Some of the direct benefits of embracing a frugal lifestyle include the following:
- Instant reduction of debt
- Increased retirement savings
- Better financial stability
Needs Vs Wants: How To Prioritize Your Lifestyle?
Needs refer to mandatory requirements. There’s no scope for compromising these aspects of your lifestyle. Remember, every criterion under your ‘needs’ should fall outside the ambit of luxuries. For instance, basic demands like food, shelter, and clothing are considered needs. Anything extravagant counts as wants, as it’s easy to get carried away if you have the ability to spend.
Take an instance related to housing. A basic home with comfortable rooms can address your housing needs. When you crave a larger home with luxury features, it comes under your ‘wants’. Ultimately, financial wants aren’t essential for you to survive. On the other hand, wants tend to increase your essence of cherishing the lifestyle.
Evidently, when you learn to differentiate needs from wants, you move closer to leading a frugal lifestyle. While prioritizing your needs, be tactful while negotiating your wants.
10 Tips To Embrace A Frugal Lifestyle That Can Help You Save Money
The secret to leading a frugal lifestyle lies in being realistic with your budget. The next hurdle is sticking to it. When you make saving a habit, you can definitely reach your financial goals. When you start saving for your future, you get to decide how you use your money and when you use it.
The guidelines in this article will help you save way more than $22 a day. Thank us later for these invaluable tips that can put you on track for a secure financial future.
1. Bank On Free Resources
What’s the point of shelling out money for resources that are available for free? As you prioritize your expenses, shortlist the expenses you can curtail by switching to free resources.
First, get habituated with the trash pickup schedule at your locality. In most localities, certain days are allocated when people can collect large items from the trash. While some items might seem to be unnecessary for others, you can find a treasure trove of usable goods. At times, people throw away things that are actually in good condition.
Who knows, you can end up finding solid furniture, bicycles in good condition, and even some electronic devices that need little repairs! Just make sure that the things you collect from trash are in good condition to be used. Ultimately, you would contribute to the zero-waste movement and lead to a sustainable future.
People who have successfully embraced a frugal lifestyle often indulge in Facebook trash groups to find valuable resources.
2. Buy Used Goods
Why not make purchasing second-hand goods a habit? Assets like cars depreciate much faster than you think. Most cars would lose 50% of their market value within the first five years. Keep your eyes open for second-hand goods in usable condition so that you can stack up your savings.
Also, consider purchasing kitchen goods, glassware, home décor items, clothing, and furniture second-hand. When you try to save more for your future, there’s nothing wrong with going for used items.
When you purchase brand-new items, you end up paying the full price. There’s limited scope for striking big bargains. So, the next time you look out for a pair of jeans, visit the consignment store or a local thrift shop. US citizens can purchase these items at just a meager cost, adding to their savings.
3. Plan Your Meals
Well, if you are a foodie and spend rampantly on restaurants, you won’t like compromising your meals. After all, inspiriting your tastebuds feels great! However, when you stride towards a frugal lifestyle, why not plan your meals to make a significant saving?
Rather than purchasing your lunch and dinner every day, try cooking them at home. This can quickly add to your savings and help you stash around $10 to $20 into your savings account each day! Now you know how much you can save over the month.
Also, consider cooking in bulk and freezing a portion for the next day. When you are on a budget, planning your meals can help you save significantly.
4. Bank On Coupons, Discounts, And Sales Windows
Apparel and groceries can weigh heavy on your pocket. Why not bank on discount codes, coupons, and sales seasons to purchase products in bulk?
There are plenty of websites, credit card rewards, and brand promotional codes to capitalize on. Each trip to a grocery or apparel store can save you a few dollars.
US citizens who have been living frugally know the advantages of saving money! If you are not comfortable with thrifting, download some of the genuine coupon apps. Also, stay abreast with the sales periods on the market or online stores to take advantage of price drops.
5. Buy Things For A Lifetime
Being selective about the goods you purchase significantly complements a frugal lifestyle. Well, it might be tempting to purchase trendy and cheap clothes or invest in flimsy apparel or furniture when they come dust-cheap. However, you don’t get the value for your money when these items start falling apart after a few months. Ultimately, there’s no point saving money upfront when you end up shelling consistently on repairs.
Rather than squandering money on trendy items, it pays to invest in high-quality household goods. These items must serve you for years, and just not a few seasons. The upfront purchase price might be marginally higher, but you need not incur recurring expenses on these items in the future.
6. Manage Your Utility Bills
It simply takes a little homework to find the best phone or internet connection that aligns with your frugal lifestyle. Why not go for the cheapest family plans and maximize your benefits? In case you already have unlimited data on your smartphone, do you really need a broadband connection at your home? Weigh your priorities carefully; you will find plenty of avenues to curtail expenses.
Utility bills can sometimes pinch your pockets, particularly in the peak of summer or winter. Consider installing a smart thermostat that can regulate internal temperatures efficiently and save energy bills.
The U.S. Department of Energy states that you can end up saving 10% a year on cooling and heating when you adjust the thermostat by 7 to 10 degrees Fahrenheit from the normal setting for eight hours a day. Maybe, you need to put on a few additional layers in winter or an additional fan in the summer. As long as you can save your utility bills, you are on track to living a frugal lifestyle.
7. Purchase Generic Products
Choosing generic products when purchasing grocery or household items can help you save a lot! It’s logical to choose store-brand goods over branded products as long as they are safe for your health. This can help you make instant savings, given that these goods offer the same utility.
For instance, why not purchase frozen vegetables from the store brand? You would eventually be chopping them and integrating them into different food recipes. It’s wise to pay less for food and groceries when you cook the same dishes.
The same applies to medicines, given that they can be expensive. However, it’s recommended to consult your physician before switching to generic medicines.
8. Indulge In Long-Term Planning
Thinking long-term pays when you indulge in a frugal lifestyle. Each time you consider making some changes in your budget, think about how they are going to affect your financial goals.
From time to time, discuss the short, mid, and long-term financial goals with your family members. Amidst economic uncertainties like inflation and recession, it pays to review your retirement savings from time to time.
Having a single long-term goal seems to be scary. Rather than thinking too big, it’s wise to take baby steps that would take you closer to your goals. Discuss your savings efforts with your family and consider their insights, which should help you reach realistic savings goals.
9. Shop Around For Affordable Insurance Policies
There’s no point denying that insurance costs can be significantly high. Unless you have proper coverage for your family, you might find yourself out of track as you cruise along to your financial goals.
Consult experts to understand your exact insurance requirements – whether you are covering your house, car, or health. Shopping around for an affordable policy makes sense since you would save thousands of dollars in the future.
10. Avoid Credit Card Debt
Now that you understand the equation better, you must realize that saving money is actually earning it. Try and avoid getting into debt, particularly the ones involving high interest rates. Credit card debts, for instance, can be expensive, with annual interest rates ranging from 15% to 40%. In case you are in need of money, consider getting a secured loan or a personal loan that comes relatively cheaper.
Also, try to pay off any kind of loan that you currently owe. Becoming debt-free is the first step towards attaining financial freedom.
The Shift Towards Economic Living!
The concept of frugal living is gaining momentum as more and more people acknowledge the shortage of resources. The biggest benefit of frugal living is, of course, saving money. If you are in debt, you can pay it off faster and move towards financial independence. Frugal living also puts you on track to save money for your future. This might also help you address your mid and long-term goals.
While sorting finances is one of the apparent benefits of frugal living, it also helps people stay happier as they crave fewer material possessions. The sense of “constant chasing” takes a back seat, and living in the present starts making sense.
Does Frugal Mean Cheap?
No, the concepts of living frugal and cheap are completely different. Buying cheap means purchasing the lowest-priced goods without considering the quality. However, living frugally means evaluating your needs and controlling your expenses by switching to alternatives that can help you save money.
What Is The 30-Day Rule?
The 30-day rule is a strategy that can help you embrace a frugal lifestyle. Do you habitually make impulse purchases? Well, the 30-day rule recommends waiting for 30 days before you make a final decision. Use this time to consider whether you should purchase the item. This’ll give you time to reconsider impulsive purchases, saving you hundreds of dollars.
Are Frugal People Happy?
Absolutely! Frugal people are happy since they voluntarily make their financial preferences. Living frugally doesn’t mean depriving yourself of all the world’s comfort. It involves making conscious financial decisions to save more for the future. Ultimately, your money remains yours; it’s only about how and when you use it!
Where Can I Invest The Money Saved By Living Frugally?
The very concept of frugal living involves curtailing unnecessary expenses to save money. You can make savings that you can put aside for your children’s savings plans or mutual funds, purchase stocks and bonds, or simply save for your golden years.